CGA takes 10% stake in Sierra

Dual-listed CGA Mining will become a strategic investor in Sierra Mining after agreeing to take a 10 per cent stake in the Perth-based explorer through a private placement.

Sierra will issue 11.8 million shares at a discounted six cents each, along with two free options exercisable at 10c each with each share, to CGA, a miner that operates the Masbate gold project in the Philippines.

"The placement will significantly strengthen the company's financial position and provide access to CGA's substantial resource management skills as well as their expertise in developing gold and other projects in the Philippines," Sierra said.

Sierra has also flagged a one-for-three entitlements issue and together with the private placement, expects to raise a total of $3.3 million.

Funds will be used to pursue exploration programs at the company's copper and gold tenements in the Philippines.

Shares in Sierra climbed 2.5c, or 26.3 per cent, to 12c at 15:21 AEST.